One of the least understood FHA guidelines is the policy regarding minimum credit scores.  In speaking with potential clients, I often hear that "my score too low it is below the minimum 620 number."  Nothing could be further from the truth.  The FHA approach is simple.  It is based on the following grid.

If the Borrower’s Minimum Decision Credit Score is...

Then the Borrower is...

at or above 580

eligible for maximum financing.

between 500 and 579

limited to a maximum LTV of 90%.

You will note that for the basic maximum financing FHA loan the minimum score is 580.  Also, you will note, those with a credit score below 580 down to a credit score of 500 may also be eligible for an FHA loan. Those loans are processed and handled the same as all FHA loans